UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-08245
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Phoenix Equity Series Fund
--------------------------------------------------
(Exact name of registrant as specified in charter)
101 Munson Street
Greenfield, MA 01301
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(Address of principal executive offices) (Zip code)
Kevin J. Carr, Esq.
Vice President, Chief Legal Officer, John H. Beers, Esq.
Counsel and Secretary for Registrant Vice President and Secretary
Phoenix Life Insurance Company Phoenix Life Insurance Company
One American Row One American Row
Hartford, CT 06103-2899 Hartford, CT 06103-2899
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(Name and address of agent for service)
Registrant's Telephone Number, Including Area Code: (800) 243-1574
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Date of Fiscal Year End: August 31
---------
Date of Reporting Period: February 28, 2006
-----------------
Form N-CSR is to be used by management investment companies to file reports with
the Commission not later than 10 days after the transmission to stockholders of
any report that is required to be transmitted to stockholders under Rule 30e-1
under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may
use the information provided on Form N-CSR in its regulatory, disclosure review,
inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR,
and the Commission will make this information public. A registrant is not
required to respond to the collection of information contained in Form N-CSR
unless the Form displays a currently valid Office of Management and Budget
("OMB") control number. Please direct comments concerning the accuracy of the
information collection burden estimate and any suggestions for reducing the
burden to Secretary, Securities and Exchange Commission, 100 F Street, NE,
Washington, DC 20549. The OMB has reviewed this collection of information under
the clearance requirements of 44 U.S.C. ss. 3507.
ITEM 1. REPORTS TO STOCKHOLDERS.
The Report to Shareholders is attached herewith.
FEBRUARY 28, 2006
SEMIANNUAL REPORT
o PHOENIX GROWTH & INCOME FUND
[GRAPHIC OMITTED]
Get Fund documents by e-mail instead.
Eligible shareholders may sign up for E-Delivery at PhoenixFunds.com.
TRUST NAME: PHOENIX EQUITY SERIES FUND
[GRAPHIC OMITTED] PHOENIXFUNDS(SM)
- --------------------------------------------------------------------------------
Mutual funds are not insured by the FDIC; are not deposits or other obligations
of a bank and are not guaranteed by a bank; and are subject to investment risks,
including possible loss of the principal invested.
- --------------------------------------------------------------------------------
This report is not authorized for distribution to prospective investors in the
Phoenix Equity Series Fund unless preceded or accompanied by an effective
prospectus which includes information concerning the sales charge, the Fund's
record and other pertinent information.
A MESSAGE FROM THE PRESIDENT
DEAR PHOENIXFUNDS SHAREHOLDER:
This semiannual report addresses the performance of your Phoenix mutual fund
for the six months ended February 28, 2006. It provides detailed information
about your fund's performance, portfolio holdings and transactions for the
period.
At Phoenix, our focus is on investment performance and serving the best
interests of our shareholders. We believe that mutual funds are among the most
effective vehicles for individual investors to gain access to a variety of
financial markets and for building diversified portfolios.
I am especially proud of how we have expanded our fund family over the last
year to offer access to even more money managers. Today, the PhoenixFunds draw
from the vast expertise of 16 different management teams--seven Phoenix
affiliates and nine outside subadvisers chosen for their complementary
investment capabilities.
These fund teams operate independently, conducting their research,
identifying opportunities in the markets they know best, and applying their
disciplined strategies to the portfolios they manage. We are confident in their
ability to navigate their funds through whatever market and economic changes lie
ahead.
When it comes to financial decisions, we recommend working with an
experienced financial advisor. If you haven't reviewed or rebalanced your
portfolio lately, this may be a good time to meet with your advisor and make
sure that your investments are still aligned with your financial goals.
Thank you for choosing PhoenixFunds to be part of your financial plan.
Sincerely yours,
/s/ Daniel T. Geraci
Daniel T. Geraci
President, PhoenixFunds
MARCH 2006
1
TABLE OF CONTENTS
Glossary..................................................................... 3
Phoenix Growth & Income Fund................................................. 4
Notes to Financial Statements................................................ 14
Board of Trustees' Consideration of Investment Advisory Agreement............ 17
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PROXY VOTING INFORMATION (FORM N-PX)
The Adviser votes proxies relating to portfolio securities in accordance with
procedures that have been approved by the Trust's Board of Trustees. You may
obtain a description of these procedures, along with information regarding how
the Funds voted proxies during the most recent 12-month period ended June 30,
2005, free of charge, by calling toll-free 1-800-243-1574. This information is
also available through the Securities and Exchange Commission's website at
http://www.sec.gov.
FORM N-Q INFORMATION
The Trust files a complete schedule of portfolio holdings with the Securities
and Exchange Commission (the "SEC") for the first and third quarters of each
fiscal year on Form N-Q. Form N-Q is available on the SEC's website at
http://www.sec.gov. Form N-Q may be reviewed and copied at the SEC's Public
Reference Room. Information on the operation of the SEC's Public Reference Room
can be obtained by calling toll-free 1-800-SEC-0330.
- --------------------------------------------------------------------------------
2
GLOSSARY
REITS (REAL ESTATE INVESTMENT TRUSTS)
Real estate investment trusts are typically publicly traded companies that own,
develop and operate income producing real estate such as apartments, office
buildings, hotels, shopping centers and other commercial properties.
3
PHOENIX GROWTH & INCOME FUND
ABOUT YOUR FUND'S EXPENSES (UNAUDITED)
We believe it is important for you to understand the impact of costs on your
investment. All mutual funds have operating expenses. As a shareholder of the
Growth & Income Fund, you incur two types of costs: (1) transaction costs,
including sales charges and contingent deferred sales charges, if applicable;
and (2) ongoing costs, including investment advisory fees; distribution and
service fees; and other expenses. These examples are intended to help you
understand your ongoing costs (in dollars) of investing in the Fund and to
compare these costs with the ongoing costs of investing in other mutual funds.
These examples are based on an investment of $1,000 invested at the beginning of
the period and held for the entire six-month period.
ACTUAL EXPENSES
The first line of the accompanying tables provides information about actual
account values and actual expenses. You may use the information in this line,
together with the amount you invested, to estimate the expenses that you paid
over the period. Simply divide your account value by $1,000 (for example, an
$8,600 account value divided by $1,000 = 8.6), then multiply the result by the
number in the first line under the heading entitled "Expenses Paid During
Period" to estimate the expenses you paid on your account during this period.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES
The second line of the accompanying tables provides information about
hypothetical account values and hypothetical expenses based on the Fund's actual
expense ratio and an assumed rate of return of 5% per year before expenses,
which is not your Fund's actual return. The hypothetical account values and
expenses may not be used to estimate the actual ending account balance or
expenses you paid for the period. You may use this information to compare the
ongoing costs of investing in your Fund and other funds. To do so, compare these
5% hypothetical examples with the 5% hypothetical examples that appear in the
shareholder reports of the other funds.
Please note that the expenses shown in the accompanying tables are meant to
highlight your ongoing costs only and do not reflect any transactional costs,
such as sales charges or contingent deferred sales charges. Therefore, the
second line of the accompanying tables is useful in comparing ongoing costs
only, and will not help you determine the relative total costs of owning
different funds. In addition, if these transactional costs were included, your
costs would have been higher. The calculations assume no shares were bought or
sold during the period. Your actual costs may have been higher or lower,
depending on the amount of your investment and the timing of any purchases or
redemptions.
Beginning Ending Expenses Paid
Growth & Income Fund Account Value Account Value During
Class A August 31, 2005 February 28, 2006 Period*
- -------------------- --------------- ----------------- -------------
Actual $1,000.00 $1,053.30 $6.36
Hypothetical (5% return
before expenses) 1,000.00 1,018.52 6.28
* EXPENSES ARE EQUAL TO THE FUND'S CLASS A ANNUALIZED EXPENSE RATIO OF 1.25%,
WHICH IS NET OF WAIVED FEES AND REIMBURSED EXPENSES, IF APPLICABLE, MULTIPLIED
BY THE AVERAGE ACCOUNT VALUE OVER THE PERIOD, MULTIPLIED BY THE NUMBER OF DAYS
IN THE MOST RECENT FISCAL HALF-YEAR, THEN DIVIDED BY 365 TO REFLECT THE
ONE-HALF YEAR PERIOD.
Beginning Ending Expenses Paid
Growth & Income Fund Account Value Account Value During
Class B August 31, 2005 February 28, 2006 Period*
- -------------------- --------------- ----------------- -------------
Actual $1,000.00 $1,049.10 $10.16
Hypothetical (5% return
before expenses) 1,000.00 1,014.76 10.04
* EXPENSES ARE EQUAL TO THE FUND'S CLASS B ANNUALIZED EXPENSE RATIO OF 2.00%,
WHICH IS NET OF WAIVED FEES AND REIMBURSED EXPENSES, IF APPLICABLE, MULTIPLIED
BY THE AVERAGE ACCOUNT VALUE OVER THE PERIOD, MULTIPLIED BY THE NUMBER OF DAYS
IN THE MOST RECENT FISCAL HALF-YEAR, THEN DIVIDED BY 365 TO REFLECT THE
ONE-HALF YEAR PERIOD.
Beginning Ending Expenses Paid
Growth & Income Fund Account Value Account Value During
Class C August 31, 2005 February 28, 2006 Period*
- -------------------- --------------- ----------------- -------------
Actual $1,000.00 $1,049.90 $10.16
Hypothetical (5% return
before expenses) 1,000.00 1,014.76 10.04
* EXPENSES ARE EQUAL TO THE FUND'S CLASS C ANNUALIZED EXPENSE RATIO OF 2.00%,
WHICH IS NET OF WAIVED FEES AND REIMBURSED EXPENSES, IF APPLICABLE, MULTIPLIED
BY THE AVERAGE ACCOUNT VALUE OVER THE PERIOD, MULTIPLIED BY THE NUMBER OF DAYS
IN THE MOST RECENT FISCAL HALF-YEAR, THEN DIVIDED BY 365 TO REFLECT THE
ONE-HALF YEAR PERIOD.
YOU CAN FIND MORE INFORMATION ABOUT THE FUNDS EXPENSES IN THE FINANCIAL
STATEMENTS SECTION THAT FOLLOWS. FOR ADDITIONAL INFORMATION ON OPERATING
EXPENSES AND OTHER SHAREHOLDER COSTS REFER TO THE PROSPECTUS.
4
Phoenix Growth & Income Fund
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SECTOR WEIGHTINGS (UNAUDITED) 2/28/06
- --------------------------------------------------------------------------------
As a percentage of total investments
[GRAPHIC OMITTED]
EDGAR REPRESENTATION OF DATA USED IN PRINTED GRAPHIC AS FOLLOWS:
Financials 24%
Information Technology 15
Health Care 14
Industrials 12
Consumer Discretionary 11
Energy 9
Telecommunication Services 5
Other 10
SCHEDULE OF INVESTMENTS
FEBRUARY 28, 2006
(UNAUDITED)
SHARES VALUE
------- ------------
DOMESTIC COMMON STOCKS--96.3%
AEROSPACE & DEFENSE--3.5%
Boeing Co. (The) ............................. 16,800 $ 1,221,192
Honeywell International, Inc. ................ 38,300 1,568,385
Lockheed Martin Corp. ........................ 26,800 1,952,916
Northrop Grumman Corp. ....................... 18,300 1,173,030
Raytheon Co. ................................. 20,300 881,020
United Technologies Corp. .................... 59,900 3,504,150
------------
10,300,693
------------
AIR FREIGHT & LOGISTICS--0.2%
Pacer International, Inc. .................... 8,300 264,355
United Parcel Service, Inc. Class B .......... 5,700 425,847
------------
690,202
------------
APPAREL RETAIL--0.4%
Gap, Inc. (The) .............................. 62,900 1,166,166
APPAREL, ACCESSORIES & LUXURY GOODS--0.2%
VF Corp. ..................................... 11,600 635,680
APPLICATION SOFTWARE--0.5%
Autodesk, Inc. ............................... 7,500 282,375
Intuit, Inc.(b) .............................. 13,500 655,830
Mercury Interactive Corp.(b) ................. 17,600 624,800
------------
1,563,005
------------
ASSET MANAGEMENT & CUSTODY BANKS--1.8%
Bank of New York Co., Inc. (The) ............. 36,200 1,239,488
Franklin Resources, Inc. ..................... 11,600 1,191,088
Northern Trust Corp. ......................... 28,700 1,513,064
State Street Corp. ........................... 20,400 1,274,592
------------
5,218,232
------------
SHARES VALUE
------- ------------
AUTOMOBILE MANUFACTURERS--0.2%
Ford Motor Co. ............................... 68,500 $ 545,945
AUTOMOTIVE RETAIL--0.1%
AutoNation, Inc.(b) .......................... 8,300 173,553
BIOTECHNOLOGY--0.2%
Applera Corp. - Applied Biosystems Group ..... 17,900 506,033
BROADCASTING & CABLE TV--0.4%
CBS Corp. Class B ............................ 28,400 694,664
EchoStar Communications Corp. Class A(b) ..... 12,000 352,440
------------
1,047,104
------------
BUILDING PRODUCTS--0.4%
Masco Corp. .................................. 36,100 1,125,959
COMMERCIAL PRINTING--0.3%
Donnelley (R.R.) & Sons Co. .................. 28,800 969,408
COMMUNICATIONS EQUIPMENT--2.9%
Cisco Systems, Inc.(b) ....................... 232,200 4,699,728
Harris Corp. ................................. 11,900 543,592
Motorola, Inc. ............................... 152,100 3,254,940
------------
8,498,260
------------
COMPUTER HARDWARE--3.3%
Dell, Inc.(b) ................................ 84,000 2,436,000
Hewlett-Packard Co. .......................... 100,200 3,287,562
International Business Machines Corp. ........ 45,400 3,642,896
NCR Corp.(b) ................................. 8,600 344,774
------------
9,711,232
------------
COMPUTER STORAGE & PERIPHERALS--0.2%
Emulex Corp.(b) .............................. 35,800 637,240
See Notes to Financial Statements
5
Phoenix Growth & Income Fund
SHARES VALUE
------- ------------
CONSTRUCTION, FARM MACHINERY & HEAVY TRUCKS--0.5%
PACCAR, Inc. ................................. 10,900 $ 761,583
Toro Co. (The) ............................... 15,100 696,563
------------
1,458,146
------------
CONSUMER FINANCE--1.2%
American Express Co. ......................... 44,000 2,370,720
Capital One Financial Corp. .................. 13,600 1,191,360
------------
3,562,080
------------
DATA PROCESSING & OUTSOURCED SERVICES--1.1%
CheckFree Corp.(b) ........................... 10,700 529,222
Computer Sciences Corp.(b) ................... 28,500 1,548,690
Fiserv, Inc.(b) .............................. 30,200 1,253,300
------------
3,331,212
------------
DEPARTMENT STORES--2.0%
Federated Department Stores, Inc. ............ 30,000 2,131,200
Nordstrom, Inc. .............................. 48,600 1,846,800
Penney (J.C.) Co., Inc. ...................... 34,300 2,011,352
------------
5,989,352
------------
DIVERSIFIED BANKS--6.4%
Bank of America Corp. ........................ 213,500 9,788,975
Comerica, Inc. ............................... 14,100 808,212
U.S. Bancorp ................................. 31,500 973,665
Wachovia Corp. ............................... 102,800 5,763,996
Wells Fargo & Co. ............................ 24,600 1,579,320
------------
18,914,168
------------
DIVERSIFIED CHEMICALS--1.0%
Dow Chemical Co. (The) ....................... 29,100 1,252,173
Eastman Chemical Co. ......................... 29,200 1,440,436
PPG Industries, Inc. ......................... 3,900 236,457
------------
2,929,066
------------
DIVERSIFIED COMMERCIAL & PROFESSIONAL SERVICES--0.3%
Dun & Bradstreet Corp.(b) .................... 10,100 734,674
ELECTRIC UTILITIES--0.4%
Cleco Corp. .................................. 15,800 355,342
PPL Corp. .................................... 26,200 833,160
------------
1,188,502
------------
ELECTRICAL COMPONENTS & EQUIPMENT--0.9%
Emerson Electric Co. ......................... 31,800 2,601,558
ELECTRONIC MANUFACTURING SERVICES--0.1%
Sanmina-SCI Corp.(b) ......................... 95,600 369,016
FOOD RETAIL--0.1%
Kroger Co. (The)(b) .......................... 21,200 424,848
SHARES VALUE
------- ------------
FOOTWEAR--0.5%
NIKE, Inc. Class B ........................... 16,800 $ 1,457,904
GAS UTILITIES--0.2%
UGI Corp. .................................... 24,700 554,515
GENERAL MERCHANDISE STORES--0.1%
Dollar General Corp. ......................... 18,200 317,044
HEALTH CARE DISTRIBUTORS--1.0%
Cardinal Health, Inc. ........................ 21,700 1,575,420
McKesson Corp. ............................... 25,500 1,380,315
------------
2,955,735
------------
HEALTH CARE EQUIPMENT--2.2%
Baxter International, Inc. ................... 34,900 1,320,965
Becton, Dickinson & Co. ...................... 35,500 2,266,675
Boston Scientific Corp.(b) ................... 5,600 136,752
Fisher Scientific International, Inc.(b) ..... 17,400 1,185,984
Kinetic Concepts, Inc.(b) .................... 7,200 267,120
PerkinElmer, Inc. ............................ 49,300 1,172,847
------------
6,350,343
------------
HEALTH CARE SERVICES--0.3%
Caremark Rx, Inc.(b) ......................... 17,100 850,725
HEALTH CARE SUPPLIES--0.5%
Bausch & Lomb, Inc. .......................... 19,400 1,342,674
HOME IMPROVEMENT RETAIL--1.6%
Home Depot, Inc. (The) ....................... 67,600 2,849,340
Sherwin-Williams Co. (The) ................... 38,700 1,762,785
------------
4,612,125
------------
HOUSEHOLD APPLIANCES--0.6%
Black & Decker Corp. (The) ................... 21,600 1,848,528
HOUSEHOLD PRODUCTS--0.8%
Kimberly-Clark Corp. ......................... 42,000 2,485,560
HOUSEWARES & SPECIALTIES--0.4%
Newell Rubbermaid, Inc. ...................... 51,900 1,290,753
INDEPENDENT POWER PRODUCERS & ENERGY TRADERS--0.4%
Constellation Energy Group, Inc. ............. 21,800 1,280,532
INDUSTRIAL CONGLOMERATES--1.7%
3M Co. ....................................... 6,300 463,617
General Electric Co. ......................... 115,000 3,780,050
Textron, Inc. ................................ 8,600 757,746
------------
5,001,413
------------
INDUSTRIAL MACHINERY--1.7%
Danaher Corp. ................................ 6,900 418,002
Dover Corp. .................................. 8,100 388,314
See Notes to Financial Statements
6
Phoenix Growth & Income Fund
SHARES VALUE
------- ------------
INDUSTRIAL MACHINERY--CONTINUED
Eaton Corp. .................................. 30,400 $ 2,117,968
Illinois Tool Works, Inc. .................... 16,700 1,433,528
Parker-Hannifin Corp. ........................ 8,500 664,445
------------
5,022,257
------------
INSURANCE BROKERS--0.2%
AON Corp. .................................... 15,300 606,033
INTEGRATED OIL & GAS--8.1%
Chevron Corp. ................................ 73,200 4,134,336
ConocoPhillips ............................... 31,900 1,944,624
Exxon Mobil Corp. ............................ 210,200 12,479,574
Occidental Petroleum Corp. ................... 56,400 5,162,856
------------
23,721,390
------------
INTEGRATED TELECOMMUNICATION SERVICES--4.2%
AT&T, Inc. ................................... 162,100 4,472,339
BellSouth Corp. .............................. 65,800 2,077,964
Citizens Communications Co. .................. 105,600 1,409,760
Qwest Communications International, Inc.(b) .. 51,100 322,952
Verizon Communications, Inc. ................. 117,400 3,956,380
------------
12,239,395
------------
INTERNET RETAIL--0.2%
IAC/InterActiveCorp.(b) ...................... 22,300 652,052
INTERNET SOFTWARE & SERVICES--0.2%
VeriSign, Inc.(b) ............................ 19,500 461,370
INVESTMENT BANKING & BROKERAGE--1.8%
Merrill Lynch & Co., Inc. .................... 53,100 4,099,851
Morgan Stanley ............................... 21,500 1,282,690
------------
5,382,541
------------
LIFE & HEALTH INSURANCE--3.6%
AFLAC, Inc. .................................. 27,100 1,253,375
Lincoln National Corp. ....................... 35,000 1,986,950
MetLife, Inc. ................................ 75,700 3,794,084
Principal Financial Group, Inc. .............. 27,700 1,349,544
Protective Life Corp. ........................ 3,900 190,125
Prudential Financial, Inc. ................... 23,200 1,787,328
StanCorp Financial Group, Inc. ............... 4,400 238,040
------------
10,599,446
------------
MANAGED HEALTH CARE--2.5%
Aetna, Inc. .................................. 41,800 2,131,800
CIGNA Corp. .................................. 9,400 1,153,850
UnitedHealth Group, Inc. ..................... 32,900 1,915,767
WellPoint, Inc.(b) ........................... 27,000 2,073,330
------------
7,274,747
------------
METAL & GLASS CONTAINERS--0.3%
Crown Holdings, Inc.(b) ...................... 35,600 651,480
SHARES VALUE
------- ------------
METAL & GLASS CONTAINERS--CONTINUED
Silgan Holdings, Inc. ........................ 6,800 $ 268,056
------------
919,536
------------
MOTORCYCLE MANUFACTURERS--0.1%
Harley-Davidson, Inc. ........................ 5,300 278,303
MOVIES & ENTERTAINMENT--2.4%
Time Warner, Inc. ............................ 285,700 4,945,467
Viacom, Inc. Class B(b) ...................... 28,400 1,134,864
Walt Disney Co. (The) ........................ 34,500 965,655
------------
7,045,986
------------
MULTI-LINE INSURANCE--1.1%
American International Group, Inc. ........... 40,100 2,661,036
Hartford Financial Services Group, Inc. (The) 3,600 296,568
Unitrin, Inc. ................................ 3,700 178,895
------------
3,136,499
------------
OIL & GAS DRILLING--0.4%
Pride International, Inc.(b) ................. 39,200 1,214,024
OIL & GAS EXPLORATION & PRODUCTION--0.4%
Burlington Resources, Inc. ................... 14,600 1,316,628
OIL & GAS REFINING, MARKETING & TRANSPORTATION--0.4%
Sunoco, Inc. ................................. 3,600 266,760
Valero Energy Corp. .......................... 16,600 892,914
------------
1,159,674
------------
OTHER DIVERSIFIED FINANCIAL SERVICES--3.6%
Citigroup, Inc. .............................. 95,000 4,405,150
JPMorgan Chase & Co. ......................... 151,000 6,212,140
------------
10,617,290
------------
PACKAGED FOODS & MEATS--2.0%
General Mills, Inc. .......................... 27,500 1,354,375
Kellogg Co. .................................. 95,100 4,213,881
Pilgrim's Pride Corp. ........................ 18,800 433,528
------------
6,001,784
------------
PHARMACEUTICALS--7.6%
Abbott Laboratories .......................... 55,000 2,429,900
Alpharma, Inc. Class A ....................... 17,000 514,250
Barr Pharmaceuticals, Inc.(b) ................ 12,300 826,314
Endo Pharmaceuticals Holdings, Inc.(b) ....... 19,000 598,880
Johnson & Johnson ............................ 122,100 7,039,065
Medicis Pharmaceutical Corp. Class A ......... 19,500 554,580
Merck & Co., Inc. ............................ 58,300 2,032,338
Pfizer, Inc. ................................. 263,800 6,908,922
Watson Pharmaceuticals, Inc.(b) .............. 7,900 236,842
Wyeth ........................................ 22,100 1,100,580
------------
22,241,671
------------
See Notes to Financial Statements
7
Phoenix Growth & Income Fund
SHARES VALUE
------- ------------
PROPERTY & CASUALTY INSURANCE--2.9%
Allstate Corp. (The) ......................... 72,400 $ 3,966,072
Cincinnati Financial Corp. ................... 5,300 235,108
Mercury General Corp. ........................ 7,000 391,300
Philadelphia Consolidated Holding Co.(b) ..... 1,900 203,300
Progressive Corp. (The) ...................... 9,700 1,042,265
St. Paul Travelers Cos., Inc. (The) .......... 63,100 2,712,038
------------
8,550,083
------------
RAILROADS--0.5%
Burlington Northern Santa Fe Corp. ........... 7,200 566,208
Norfolk Southern Corp. ....................... 15,900 813,762
------------
1,379,970
------------
REGIONAL BANKS--0.9%
Bank of Hawaii Corp. ......................... 12,000 640,800
KeyCorp ...................................... 28,000 1,043,560
National City Corp. .......................... 7,800 271,440
SunTrust Banks, Inc. ......................... 5,000 361,850
Synovus Financial Corp. ...................... 14,200 402,570
------------
2,720,220
------------
REITS--0.8%
American Home Mortgage Investment Corp. ...... 13,400 381,900
Boston Properties, Inc. ...................... 7,800 660,426
Highwoods Properties, Inc. ................... 28,500 921,975
New Plan Excel Realty Trust .................. 15,500 388,275
------------
2,352,576
------------
RESTAURANTS--1.4%
McDonald's Corp. ............................. 82,100 2,866,111
Yum! Brands, Inc. ............................ 26,200 1,249,740
------------
4,115,851
------------
SEMICONDUCTORS--2.8%
Advanced Micro Devices, Inc.(b) .............. 3,800 146,946
Freescale Semiconductor, Inc. Class B(b) ..... 23,200 627,328
Intel Corp. .................................. 230,700 4,752,420
LSI Logic Corp.(b) ........................... 28,700 279,825
ON Semiconductor Corp.(b) .................... 64,200 423,078
Texas Instruments, Inc. ...................... 67,400 2,011,890
------------
8,241,487
------------
SOFT DRINKS--0.8%
Coca-Cola Co. (The) .......................... 34,300 1,439,571
Pepsi Bottling Group, Inc. (The) ............. 11,900 349,384
PepsiAmericas, Inc. .......................... 17,300 413,816
------------
2,202,771
------------
SPECIALIZED CONSUMER SERVICES--0.3%
Block (H&R), Inc. ............................ 36,200 807,260
SHARES VALUE
------- ------------
SPECIALTY CHEMICALS--0.2%
Rohm and Haas Co. ............................ 8,900 $ 442,775
SPECIALTY STORES--0.2%
Barnes & Noble, Inc. ......................... 5,600 241,192
Staples, Inc. ................................ 8,500 208,590
------------
449,782
------------
SYSTEMS SOFTWARE--3.7%
BMC Software, Inc.(b) ........................ 19,900 435,213
Microsoft Corp. .............................. 289,800 7,795,620
Oracle Corp.(b) .............................. 198,500 2,465,370
Symantec Corp.(b) ............................ 13,500 228,015
------------
10,924,218
------------
TECHNOLOGY DISTRIBUTORS--0.3%
Arrow Electronics, Inc.(b) ................... 15,400 535,766
Tech Data Corp.(b) ........................... 10,000 415,300
------------
951,066
------------
TOBACCO--0.8%
Reynolds American, Inc. ...................... 22,800 2,420,220
TRUCKING--0.2%
CNF, Inc. .................................... 12,700 637,286
WIRELESS TELECOMMUNICATION SERVICES--0.8%
Sprint Nextel Corp. .......................... 93,000 2,234,790
- --------------------------------------------------------------------------------
TOTAL DOMESTIC COMMON STOCKS
(IDENTIFIED COST $218,279,409) 282,960,166
- --------------------------------------------------------------------------------
FOREIGN COMMON STOCKS(c)--2.6%
DIVERSIFIED METALS & MINING--0.4%
Freeport-McMoRan Copper & Gold, Inc.
Class B (Indonesia) .......................... 21,700 1,098,671
INDUSTRIAL CONGLOMERATES--0.7%
Tyco International Ltd. (United States) ...... 81,200 2,094,148
INDUSTRIAL MACHINERY--1.3%
Ingersoll-Rand Co. Ltd. Class A (United States) 93,100 3,819,893
OIL & GAS DRILLING--0.1%
Nabors Industries Ltd. (United States)(b) .... 5,700 375,915
PROPERTY & CASUALTY INSURANCE--0.1%
XL Capital Ltd. Class A (United States) ...... 5,200 351,261
- --------------------------------------------------------------------------------
TOTAL FOREIGN COMMON STOCKS
(IDENTIFIED COST $5,601,429) 7,739,888
- --------------------------------------------------------------------------------
TOTAL LONG TERM INVESTMENTS--98.9%
(IDENTIFIED COST $223,880,838) 290,700,054
- --------------------------------------------------------------------------------
See Notes to Financial Statements
8
Phoenix Growth & Income Fund
PAR
VALUE
(000) VALUE
------- ------------
SHORT-TERM INVESTMENTS(d)--1.2%
COMMERCIAL PAPER--1.2%
Old Line Funding Corp. 4.55%, 3/1/06 ......... $ 2,670 $ 2,670,000
UBS Finance Delaware LLC 4.49%, 3/20/06 ...... 940 937,772
- --------------------------------------------------------------------------------
TOTAL SHORT-TERM INVESTMENTS
(IDENTIFIED COST $3,607,772) 3,607,772
- --------------------------------------------------------------------------------
TOTAL INVESTMENTS--100.1%
(IDENTIFIED COST $227,488,610) 294,307,826(a)
Other assets and liabilities, net--(0.1)% (368,190)
------------
NET ASSETS--100.0% $293,939,636
============
(a) Federal Income Tax Information: Net unrealized appreciation of investment
securities is comprised of gross appreciation of $69,670,904 and gross
depreciation of $4,668,020 for federal income tax purposes. At February 28,
2006, the aggregate cost of securities for federal income tax purposes was
$229,304,942.
(b) Non-income producing.
(c) Common stock is considered to be foreign if the security is issued in a
foreign country. The country of risk, noted parenthetically, is determined
based on criteria described in Note 2F "Foreign security country
determination" in the Notes to Financial Statements.
(d) The rate shown is the discount rate.
See Notes to Financial Statements
9
Phoenix Growth & Income Fund
STATEMENT OF ASSETS AND LIABILITIES
FEBRUARY 28, 2006
(UNAUDITED)
ASSETS
Investment securities at value
(Identified cost $227,488,610) $ 294,307,826
Cash 2,961
Receivables
Investment securities sold 1,153,495
Dividends 600,233
Fund shares sold 109,969
Prepaid expenses 33,314
-------------
Total assets 296,207,798
-------------
LIABILITIES
Payables
Investment securities purchased 1,215,042
Fund shares repurchased 504,481
Investment advisory fee 233,899
Distribution and service fees 124,497
Transfer agent fee 118,673
Financial agent fee 16,227
Trustees' fee 84
Other accrued expenses 55,259
-------------
Total liabilities 2,268,162
-------------
NET ASSETS $ 293,939,636
=============
NET ASSETS CONSIST OF:
Capital paid in on shares of beneficial interest $ 305,928,802
Undistributed net investment income 774,411
Accumulated net realized loss (79,582,793)
Net unrealized appreciation 66,819,216
-------------
NET ASSETS $ 293,939,636
=============
CLASS A
Shares of beneficial interest outstanding, no par value,
unlimited authorization (Net Assets $177,046,449) 11,480,512
Net asset value per share $15.42
Offering price per share $15.42/(1-5.75%) $16.36
CLASS B
Shares of beneficial interest outstanding, no par value,
unlimited authorization (Net Assets $53,241,884) 3,596,840
Net asset value and offering price per share $14.80
CLASS C
Shares of beneficial interest outstanding, no par value,
unlimited authorization (Net Assets $63,651,303) 4,298,720
Net asset value and offering price per share $14.81
STATEMENT OF OPERATIONS
SIX MONTHS ENDED FEBRUARY 28, 2006
(UNAUDITED)
INVESTMENT INCOME
Dividends $ 3,068,626
Interest 42,696
-----------
Total investment income 3,111,322
-----------
EXPENSES
Investment advisory fee 1,114,199
Service fees, Class A 220,169
Distribution and service fees, Class B 279,185
Distribution and service fees, Class C 325,741
Financial agent fee 97,610
Transfer agent 291,276
Printing 43,154
Custodian 34,695
Registration 24,965
Professional 16,843
Trustees 10,747
Miscellaneous 15,068
-----------
Total expenses 2,473,652
Less expenses reimbursed by investment adviser (162,846)
Custodian fees paid indirectly (111)
-----------
Net expenses 2,310,695
-----------
NET INVESTMENT INCOME (LOSS) 800,627
-----------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net realized gain (loss) on investments 11,585,889
Net change in unrealized appreciation (depreciation) on
investments 2,717,825
-----------
NET GAIN (LOSS) ON INVESTMENTS 14,303,714
-----------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS $15,104,341
===========
See Notes to Financial Statements
10
Phoenix Growth & Income Fund
STATEMENT OF CHANGES IN NET ASSETS
Six Months
Ended
February 28, 2006 Year Ended
(Unaudited) August 31, 2005
----------------- ---------------
FROM OPERATIONS
Net investment income (loss) $ 800,627 $ 1,847,479
Net realized gain (loss) 11,585,889 21,670,359
Net change in unrealized appreciation (depreciation) 2,717,825 17,884,306
------------ ------------
INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 15,104,341 41,402,144
------------ ------------
FROM DISTRIBUTIONS TO SHAREHOLDERS
Net investment income, Class A (1,228,917) (1,452,732)
Net investment income, Class B (92,868) --
Net investment income, Class C (108,027) --
------------ ------------
DECREASE IN NET ASSETS FROM DISTRIBUTIONS TO SHAREHOLDERS (1,429,812) (1,452,732)
------------ ------------
FROM SHARE TRANSACTIONS
CLASS A
Proceeds from sales of shares (710,925 and 1,997,444 shares, respectively) 10,638,072 27,925,745
Net asset value of shares issued from reinvestment of distributions
(73,111 and 91,266 shares, respectively) 1,106,158 1,313,326
Cost of shares repurchased (1,418,826 and 5,282,461 shares, respectively) (21,290,159) (75,799,152)
------------ ------------
Total (9,545,929) (46,560,081)
------------ ------------
CLASS B
Proceeds from sales of shares (104,071 and 293,577 shares, respectively) 1,496,281 3,994,747
Net asset value of shares issued from reinvestment of distributions
(5,397 and 0 shares, respectively) 78,475 --
Cost of shares repurchased (680,181 and 1,567,775 shares, respectively) (9,797,932) (21,296,307)
------------ ------------
Total (8,223,176) (17,301,560)
------------ ------------
CLASS C
Proceeds from sales of shares (56,552 and 152,294 shares, respectively) 810,438 2,062,094
Net asset value of shares issued from reinvestment of distributions
(6,071 and 0 shares, respectively) 88,331 --
Cost of shares repurchased (606,895 and 1,536,190 shares, respectively) (8,722,443) (20,828,361)
------------ ------------
Total (7,823,674) (18,766,267)
------------ ------------
INCREASE (DECREASE) IN NET ASSETS FROM SHARE TRANSACTIONS (25,592,779) (82,627,908)
------------ ------------
NET INCREASE (DECREASE) IN NET ASSETS (11,918,250) (42,678,496)
NET ASSETS
Beginning of period 305,857,886 348,536,382
------------ ------------
END OF PERIOD (INCLUDING UNDISTRIBUTED NET INVESTMENT INCOME OF
$774,411 AND $1,403,596, RESPECTIVELY) $293,939,636 $305,857,886
============ ============
See Notes to Financial Statements
11
Phoenix Growth & Income Fund
FINANCIAL HIGHLIGHTS
(SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD)
CLASS A
-----------------------------------------------------------------------
SIX MONTHS
ENDED YEAR ENDED AUGUST 31
FEBRUARY 28, 2006 -----------------------------------------------------
(UNAUDITED) 2005 2004 2003 2002 2001
Net asset value, beginning of period $14.74 $13.15 $11.86 $10.86 $13.30 $16.85
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss) (1) 0.06 0.12 0.09 0.09 0.04 0.02
Net realized and unrealized gain (loss) 0.72 1.57 1.30 0.91 (2.48) (3.57)
------ ------ ------ ------ ------ ------
TOTAL FROM INVESTMENT OPERATIONS 0.78 1.69 1.39 1.00 (2.44) (3.55)
------ ------ ------ ------ ------ ------
LESS DISTRIBUTIONS
Dividends from net investment income (0.10) (0.10) (0.10) -- -- --
------ ------ ------ ------ ------ ------
TOTAL DISTRIBUTIONS (0.10) (0.10) (0.10) -- -- --
------ ------ ------ ------ ------ ------
Change in net asset value 0.68 1.59 1.29 1.00 (2.44) (3.55)
------ ------ ------ ------ ------ ------
NET ASSET VALUE, END OF PERIOD $15.42 $14.74 $13.15 $11.86 $10.86 $13.30
====== ====== ====== ====== ====== ======
Total return(2) 5.33%(3) 12.85% 11.74% 9.21% (18.35)% (21.07)%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands) $177,046 $178,557 $201,330 $131,169 $166,772 $245,471
RATIO TO AVERAGE NET ASSETS OF:
Net operating expenses 1.25%(4) 1.25% 1.25% 1.25% 1.25 % 1.25 %
Gross operating expenses 1.36%(4) 1.40% 1.38% 1.45% 1.35 % 1.32 %
Net investment income (loss) 0.85%(4) 0.84% 0.68% 0.82% 0.33 % 0.16 %
Portfolio turnover 15%(3) 41% 53% 59% 40 % 34 %
CLASS B
-----------------------------------------------------------------------
SIX MONTHS
ENDED YEAR ENDED AUGUST 31
FEBRUARY 28, 2006 -----------------------------------------------------
(UNAUDITED) 2005 2004 2003 2002 2001
Net asset value, beginning of period $14.13 $12.61 $11.38 $10.50 $12.95 $16.54
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss) (1) 0.01 0.01 (0.01) 0.01 (0.05) (0.09)
Net realized and unrealized gain (loss) 0.68 1.51 1.25 0.87 (2.40) (3.50)
------ ------ ------ ------ ------ ------
TOTAL FROM INVESTMENT OPERATIONS 0.69 1.52 1.24 0.88 (2.45) (3.59)
------ ------ ------ ------ ------ ------
LESS DISTRIBUTIONS
Dividends from net investment income (0.02) -- (0.01) -- -- --
------ ------ ------ ------ ------ ------
TOTAL DISTRIBUTIONS (0.02) -- (0.01) -- -- --
------ ------ ------ ------ ------ ------
Change in net asset value 0.67 1.52 1.23 0.88 (2.45) (3.59)
------ ------ ------ ------ ------ ------
NET ASSET VALUE, END OF PERIOD $14.80 $14.13 $12.61 $11.38 $10.50 $12.95
====== ====== ====== ====== ====== ======
Total return(2) 4.91%(3) 12.05% 10.90 % 8.38% (18.92)% (21.70)%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands) $53,242 $58,869 $68,637 $72,051 $81,000 $116,539
RATIO TO AVERAGE NET ASSETS OF:
Net operating expenses 2.00%(4) 2.00% 2.00 % 2.00% 2.00 % 2.00 %
Gross operating expenses 2.11%(4) 2.15% 2.14 % 2.20% 2.10 % 2.06 %
Net investment income (loss) 0.09%(4) 0.10% (0.07)% 0.08% (0.42)% (0.60)%
Portfolio turnover 15%(3) 41% 53 % 59% 40 % 34 %
<FN>
(1) Computed using average shares outstanding.
(2) Sales charges are not reflected in total return calculation.
(3) Not annualized.
(4) Annualized.
</FN>
See Notes to Financial Statements
12
Phoenix Growth & Income Fund
FINANCIAL HIGHLIGHTS
(SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD)
CLASS C
-----------------------------------------------------------------------
SIX MONTHS
ENDED YEAR ENDED AUGUST 31
FEBRUARY 28, 2006 -----------------------------------------------------
(UNAUDITED) 2005 2004 2003 2002 2001
Net asset value, beginning of period $14.13 $12.62 $11.38 $10.50 $12.96 $16.55
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss)(1) 0.01 0.01 (0.01) 0.01 (0.05) (0.09)
Net realized and unrealized gain (loss) 0.69 1.50 1.26 0.87 (2.41) (3.50)
------ ------ ------ ------ ------ ------
TOTAL FROM INVESTMENT OPERATIONS 0.70 1.51 1.25 0.88 (2.46) (3.59)
------ ------ ------ ------ ------ ------
LESS DISTRIBUTIONS
Dividends from net investment income (0.02) -- (0.01) -- -- --
------ ------ ------ ------ ------ ------
TOTAL DISTRIBUTIONS (0.02) -- (0.01) -- -- --
------ ------ ------ ------ ------ ------
Change in net asset value 0.68 1.51 1.24 0.88 (2.46) (3.59)
------ ------ ------ ------ ------ ------
NET ASSET VALUE, END OF PERIOD $14.81 $14.13 $12.62 $11.38 $10.50 $12.96
====== ====== ====== ====== ====== ======
Total return(2) 4.99%(3) 12.05% 10.80 % 8.48% (18.98)% (21.69)%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands) $63,651 $68,432 $78,570 $52,466 $61,193 $86,080
RATIO TO AVERAGE NET ASSETS OF:
Net operating expenses 2.00%(4) 2.00% 2.00 % 2.00% 2.00 % 2.00 %
Gross operating expenses 2.11%(4) 2.15% 2.13 % 2.20% 2.10 % 2.06 %
Net investment income (loss) 0.09%(4) 0.10% (0.07)% 0.08% (0.42)% (0.60)%
Portfolio turnover 15%(3) 41% 53 % 59% 40 % 34 %
<FN>
(1) Computed using average shares outstanding.
(2) Sales charges are not reflected in total return calculation.
(3) Not annualized.
(4) Annualized.
</FN>
See Notes to Financial Statements
13
PHOENIX EQUITY SERIES FUND
NOTES TO FINANCIAL STATEMENTS
FEBRUARY 28, 2006 (UNAUDITED)
1. ORGANIZATION
Phoenix Equity Series Fund (the "Trust") is organized as a Delaware statutory
trust and is registered under the Investment Company Act of 1940, as amended, as
a diversified, open-end management investment company.
Currently one fund, the Phoenix Growth & Income Fund (the "Fund") is offered
for sale. The Fund is diversified and has an investment objective of seeking
dividend growth, current income, and capital appreciation.
The Fund offers Class A, Class B and Class C shares. Class A shares are sold
with a front-end sales charge of up to 5.75%. Generally, Class A shares are not
subject to any charges by the Fund when redeemed; however, effective January 11,
2006, a 1% contingent deferred sales charge may be imposed on certain
redemptions within one year on purchases on which a finder's fee has been paid.
Class B shares are sold with a contingent deferred sales charge, which declines
from 5% to zero depending on the period of time the shares are held. Class C
shares are sold with a 1% contingent deferred sales charge if redeemed within
one year of purchase.
Each class of shares has identical voting, dividend, liquidation and other
rights and the same terms and conditions, except that each class bears different
distribution and/or service expenses and has exclusive voting rights with
respect to its distribution plan. Income and expenses and realized and
unrealized gains and losses of the Fund are borne pro rata by the holders of
each class of shares.
2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently
followed by the Trust in the preparation of its financial statements. The
preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities, and disclosure of contingent assets and liabilities at the date of
the financial statements and reported increases and decreases in net assets from
operations during the reporting period. Actual results could differ from those
estimates.
A. SECURITY VALUATION:
Equity securities are valued at the official closing price (typically last
sale) on the exchange on which the securities are primarily traded, or if no
closing price is available, at the last bid price.
Debt securities are valued on the basis of broker quotations or valuations
provided by a pricing service, which utilizes information with respect to recent
sales, market transactions in comparable securities, quotations from dealers,
and various relationships between securities in determining value.
As required, some securities and assets may be valued at fair value as
determined in good faith by or under the direction of the Trustees.
Certain foreign common stocks may be fair valued in cases where closing
prices are not readily available or are deemed not reflective of readily
available market prices. For example, significant events (such as movement in
the U.S. securities market, or other regional and local developments) may occur
between the time that foreign markets close (where the security is principally
traded) and the time that the Fund calculates its net asset value (generally,
the close of the NYSE) that may impact the value of securities traded in these
foreign markets. In these cases, information from an external vendor may be
utilized to adjust closing market prices of certain foreign common stocks to
reflect their fair value. Because the frequency of significant events is not
predictable, fair valuation of certain foreign common stocks may occur on a
frequent basis.
Short-term investments having a remaining maturity of 60 days or less are
valued at amortized cost, which approximates market.
B. SECURITY TRANSACTIONS AND RELATED INCOME:
Security transactions are recorded on the trade date. Dividend income is
recorded on the ex-dividend date, or in the case of certain foreign securities,
as soon as the Fund is notified. Interest income is recorded on the accrual
basis. The Fund amortizes premiums and accretes discounts using the effective
interest method. Realized gains and losses are determined on the identified cost
basis.
C. INCOME TAXES:
It is the policy of the Fund to comply with the requirements of the Internal
Revenue Code and to distribute substantially all of its taxable income to its
shareholders. Therefore, no provision for federal income taxes or excise taxes
has been made.
The Trust may be subject to foreign taxes on income, gains on investments or
currency repatriation, a portion of which may be recoverable. The Fund will
accrue such taxes and recoveries as applicable based upon current
interpretations of the tax rules and regulations that exist in the markets in
which they invest.
D. DISTRIBUTIONS TO SHAREHOLDERS:
Distributions are recorded by the Fund on the ex-dividend date. Income and
capital gain distributions are determined in accordance with income tax
regulations which may differ from accounting principles generally accepted in
the United States of America. These differences may include the treatment of
non-taxable dividends, market premium and discount, non-deductible expenses,
expiring capital loss carryovers, foreign currency gain or loss, gain or loss on
futures contracts, partnerships, operating losses and losses deferred due to
wash sales. Permanent book and tax basis differences relating to shareholder
distributions will result in reclassifications to capital paid in on shares of
beneficial interest.
14
PHOENIX EQUITY SERIES FUND
NOTES TO FINANCIAL STATEMENTS
FEBRUARY 28, 2006 (UNAUDITED) (CONTINUED)
E. FOREIGN CURRENCY TRANSLATION:
Foreign securities and other assets and liabilities are valued using the
foreign currency exchange rate effective at the end of the reporting period.
Cost of investments is translated at the currency exchange rate effective at the
trade date. The gain or loss resulting from a change in currency exchange rates
between the trade and settlement date of a portfolio transaction is treated as a
gain or loss on foreign currency. Likewise, the gain or loss resulting from a
change in currency exchange rates between the date income is accrued and paid is
treated as a gain or loss on foreign currency. The Trust does not isolate that
portion of the results of operations arising from either changes in exchange
rates or in the market prices of securities.
F. FOREIGN SECURITY COUNTRY DETERMINATION:
A combination of the following criteria is used to assign the countries of
risk listed in the schedule of investments: country of incorporation, actual
building address, primary exchange on which the security is traded and country
in which the greatest percentage of company revenue is generated.
G. REIT INVESTMENTS:
Dividend income is recorded using management's estimate of the income
included in distributions received from the REIT investments. Distributions
received in excess of this estimated amount are recorded as a reduction of the
cost of investments or reclassified to capital gains. The actual amounts of
income, return of capital, and capital gains are only determined by each REIT
after its fiscal year-end, and may differ from the estimated amounts.
3. INVESTMENT ADVISORY FEE AND RELATED PARTY TRANSACTIONS
As compensation for its services to the Fund, Engemann Asset Management (the
"Adviser"), an indirect wholly-owned subsidiary of The Phoenix Companies, Inc.
("PNX"), is entitled to a fee at an annual rate of 0.75% of the average daily
net assets of the Fund for the first $1 billion; 0.70% of such value over $1
billion to $2 billion; and 0.65% of such value in excess of $2 billion. The
Adviser has contractually agreed to limit total fund operating expenses,
(excluding interest, taxes, and extraordinary expenses), through December 31,
2006, so that such expenses do not exceed the following percentages of the
average annual net asset values for the Fund:
Class A Class B Class C
------- ------- -------
Growth & Income Fund.............. 1.25% 2.00% 2.00%
The Adviser will not seek to recapture any reimbursed expenses under this
agreement.
As Distributor of the Fund's shares, Phoenix Equity Planning Corporation
("PEPCO"), an indirect wholly-owned subsidiary of PNX, has advised the Fund that
it retained net selling commissions of $5,420 for Class A shares and deferred
sales charges of $27,068 for Class B shares and $824 for Class C shares for the
six-month period (the "period") ended February 28, 2006.
In addition, the Fund pays PEPCO distribution and/or service fees at an
annual rate of 0.25% for Class A shares and 1.00% for Class B shares and 1.00%
for Class C shares of the average daily net assets of each respective class.
Under certain circumstances, shares of certain Phoenix Funds may be exchanged
for shares of the same class of certain other Phoenix Funds on the basis of the
relative net asset values per share at the time of the exchange. On exchanges
with share classes that carry a contingent deferred sales charge, the CDSC
schedule of the original shares purchased continues to apply.
As financial agent of the Fund, PEPCO receives a financial agent fee equal to
the sum of (1) the documented cost to PEPCO to provide oversight of the
performance of PFPC Inc. (subagent to PEPCO), plus (2) the documented cost of
fund accounting, tax services and related services provided by PFPC Inc. For the
period ended Februay 28, 2006, the Fund incurred financial agent fees totaling
$97,610.
PEPCO serves as the Fund's Transfer Agent with State Street Bank and Trust
Company serving as sub-transfer agent. For the period ended February 28, 2006,
transfer agent fees were $291,276 as reported in the Statement of Operations, of
which PEPCO retained $132,342.
At February 28, 2006, PNX and its affiliates, the retirement plans of PNX and
its affiliates, and Phoenix-affiliated funds held 971,375 Class A shares of the
Fund with an aggregate net asset value of $14,978,603.
4. PURCHASES AND SALES OF SECURITIES
Purchases and sales of securities during the period ended February 28, 2006
(excluding U.S. Government and agency securities and short-term securities)
amounted to $45,521,227 and $70,854,612, respectively. There were no purchases
or sales of long-term U.S. Government and agency securities during the period
ended February 28, 2006.
5. CREDIT RISK AND ASSET CONCENTRATIONS
In countries with limited or developing markets, investments may present
greater risks than in more developed markets and the prices of such investments
may be volatile. The consequences of political, social or economic changes in
these markets may have disruptive effects on the market prices of these
investments and the income they generate, as well as a fund's ability to
repatriate such amounts.
The Fund may invest a high percentage of its assets in specific sectors of
the market in its pursuit of a greater investment return. Fluctuations in these
sectors of concentration may have a greater impact on the Fund, positive or
negative, than if the Fund did not concentrate its investments in such sectors.
15
PHOENIX EQUITY SERIES FUND
NOTES TO FINANCIAL STATEMENTS
FEBRUARY 28, 2006 (UNAUDITED) (CONTINUED)
6. INDEMNIFICATIONS
Under the Fund's organizational documents, its trustees and officers are
indemnified against certain liabilities arising out of the performance of their
duties to the Fund. In addition, the Fund enters into contracts that contain a
variety of indemnifications. The Fund's maximum exposure under these
arrangements is unknown. However, the Fund has not had prior claims or losses
pursuant to these contracts and expects the risk of loss to be remote.
7. REGULATORY EXAMS
Federal and state regulatory authorities from time to time make inquiries and
conduct examinations regarding compliance by The Phoenix Companies, Inc. and its
subsidiaries (collectively "the Company") with securities and other laws and
regulations affecting their registered products. During 2004 and 2005, the
Boston District Office of the Securities and Exchange Commission ("SEC")
conducted an examination of the Company's investment company and investment
adviser affiliates. Following the examination, the staff of the SEC Boston
District Office issued a deficiency letter primarily focused on perceived
weaknesses in procedures for monitoring trading to prevent market timing
activity prior to 2004. The staff requested the Company to conduct an analysis
as to whether shareholders, policyholders and contract holders who invested in
the funds that may have been affected by undetected market timing activity had
suffered harm and to advise the staff whether the Company believes reimbursement
is necessary or appropriate under the circumstances. Market timing is an
investment technique involving frequent short-term trading of mutual fund shares
that is designed to exploit market movements or inefficiencies in the way mutual
fund companies price their shares. A third party was retained to assist the
Company in preparing the analysis. In 2005, based on the third party analysis
the Company notified the staff at the SEC Boston District Office that
reimbursements were not appropriate under the circumstances. The Company does
not believe that the outcome of this matter will be material to these financial
statements.
8. FEDERAL INCOME TAX INFORMATION
The Fund has capital loss carryovers which may be used to offset future
capital gains, as follows:
Expiration Year
------------------------------------------------------------------
2008 2009 2010 2011 2012 Total
---- ---- ---- ---- ---- -----
$36,594 $23,403,690 $15,349,731 $47,229,498 $2,953,031 $88,972,544
The Trust may not realize the benefit of these losses to the extent it does
not realize gains on investments prior to the expiration of the capital loss
carryovers.
16
BOARD OF TRUSTEES' CONSIDERATION OF INVESTMENT ADVISORY AGREEMENT FOR
PHOENIX GROWTH & INCOME FUND
FEBRUARY 28, 2006 (UNAUDITED)
The Board of Trustees is responsible for determining whether to approve the
Fund's investment advisory agreement. At a meeting held on November 4th, 2005,
the Board, including a majority of the independent Trustees, approved the
investment advisory agreement (the "Advisory Agreement") between Engemann Asset
Management ("EAM") and the Fund. Pursuant to the Advisory Agreement EAM provides
advisory services to the Fund.
During the review process, the Board received assistance and advice from, and
met separately with, independent legal counsel. In approving the agreement, the
Board, including a majority of the independent Trustees, determined that the fee
structure was fair and reasonable and that approval of the agreement was in the
best interests of the Fund and its shareholders. While attention was given to
all information furnished, the following discusses the primary factors relevant
to the Board's decision.
NATURE, EXTENT AND QUALITY OF SERVICES. The Board concluded that the nature,
extent and quality of the overall services provided by EAM and its affiliates to
the Fund and its shareholders was reasonable. The Board's conclusion was based,
in part, upon services provided to the Fund such as quarterly reports provided
by EAM and its affiliates comparing the performance of the Fund with a peer
group and benchmark, reports provided by EAM and its affiliates showing that the
investment policies and restrictions for the Fund were followed and reports
provided by EAM and its affiliates covering matters such as the compliance of
investment personnel and other access persons with EAM's and the Fund's code of
ethics, the adherence to fair value pricing procedures established by the Board,
the monitoring of portfolio compliance, information on illiquid securities and
derivatives, brokerage commissions and presentations regarding the economic
environment and general investment outlook. The Board also considered the
experience of EAM as an investment advisor and the experience of the team of
portfolio managers that manage the Fund. In this regard, the Board noted that
each member of the portfolio management team had over 15 years of experience in
the investment management business. Turning to compensation, the Board noted
that a primary factor in EAM's determination of the amount of bonus compensation
to portfolio managers was the relative investment performance of the funds that
they managed which aligned their interests with those of the Fund's
shareholders. The Board also considered and was satisfied with the adequacy of
EAM's compliance program. The Board also noted the extent of benefits that are
provided to Fund shareholders from being part of the Phoenix family of funds,
including the right to exchange investments between the same class of funds
without a sales charge, the ability to reinvest Fund dividends into other funds
and the right to combine holdings in other funds to obtain a reduced sales
charge. The Board also considered the transfer agent and shareholder services
that are provided to Fund shareholders by an affiliate of EAM, noting continuing
improvements by management in the scope and quality of services and favorable
reports on such service conducted by third parties.
INVESTMENT PERFORMANCE. The Board placed significant emphasis on the
investment performance of the Fund in view of its importance to shareholders.
While consideration was given to performance reports and discussions at Board
meetings throughout the year, particular attention in assessing such performance
was given to a report for the Fund prepared by Lipper Financial Services
("Lipper") furnished for the contract renewal process. The Lipper report showed
the investment performance of the Fund's Class A shares for the 1, 3 and 5 year
periods ended September 30, 2005 and the year-to-date period ended September 30,
2005. The Board reviewed the investment performance of the Fund, along with
comparative performance information of a peer group of funds and a relevant
market index. The Board noted and was satisfied that the Fund had exceeded the
Lipper peer group average for its investment style for the 1, 3, 5 and year to
date periods.
PROFITABILITY. The Board also considered the level of profits realized by EAM
and its affiliates in connection with the operation of the Fund. In this regard,
the Board reviewed the Fund profitability analysis. Specific attention was given
to the methodology followed in allocating costs to the Fund, it being recognized
that allocation methodologies are inherently subjective and various allocation
methodologies may each be reasonable while producing different results. In this
regard, the Board noted that the allocation appeared reasonable. The Board also
noted the voluntary reimbursements provided to the Fund. The Board concluded
that the profitability to EAM from the Fund was reasonable.
MANAGEMENT FEE AND TOTAL EXPENSES. The Board also placed significant emphasis
on the review of expenses of the Fund. Consideration was given to a comparative
analysis of the management fees and total expense ratios of the Fund compared
with those of a group of other funds selected by Lipper as its appropriate
Lipper expense group under the Lipper report. The Board noted that the total
expenses of the Fund were less than the average total expenses for comparable
funds and that the management fee was equal to the median for the peer group.
The Board was satisfied with the manage-
17
BOARD OF TRUSTEES' CONSIDERATION OF INVESTMENT ADVISORY AGREEMENT FOR
PHOENIX GROWTH & INCOME FUND
FEBRUARY 28, 2006 (UNAUDITED) (CONTINUED)
ment fee and total expenses of the Fund in comparison to its expense group as
shown in the Lipper report and concluded that such fee and expenses were
reasonable.
ECONOMIES OF SCALE. The Board noted that the management fee included
breakpoints based on the amount of assets under management. The Board also noted
that it was likely that EAM and the Fund would achieve certain economies of
scale as the assets grew covering certain fixed costs. The Board concluded that
shareholders would have an opportunity to benefit from these economies of scale.
18
PHOENIX EQUITY SERIES FUND
101 Munson Street
Greenfield, MA 01301
TRUSTEES
E. Virgil Conway
Harry Dalzell-Payne
S. Leland Dill(1)
Francis E. Jeffries
Leroy Keith, Jr.
Marilyn E. LaMarche
Philip R. McLoughlin, Chairman
Geraldine M. McNamara
Everett L. Morris(2)
James M. Oates
Donald B. Romans(1)
Richard E. Segerson
OFFICERS
Daniel T. Geraci, President
George R. Aylward, Executive Vice President
Francis G. Waltman, Senior Vice President
Marc Baltuch, Vice President and Chief Compliance Officer
Nancy G. Curtiss, Chief Financial Officer and Treasurer
Kevin J. Carr, Vice President, Chief Legal Officer, Counsel and Secretary
(1) Pursuant to the Trust's retirement policy, Messrs. Dill and Romans will
retire from the Board of Trustees effective April 29, 2006.
(2) Pursuant to the Trust's retirement policy, Mr. Morris will retire from the
Board of Trustees immediately following its May 2006 meeting.
INVESTMENT ADVISER
Engemann Asset Management
600 North Rosemead Boulevard
Pasadena, CA 91107-2133
PRINCIPAL UNDERWRITER
Phoenix Equity Planning Corporation
One American Row
Hartford, CT 06103-2899
TRANSFER AGENT
Phoenix Equity Planning Corporation
One American Row
Hartford, CT 06103-2899
CUSTODIAN
State Street Bank and Trust Company
P.O. Box 5501
Boston, MA 02206-5501
HOW TO CONTACT US
Mutual Fund Services 1-800-243-1574
Advisor Consulting Group 1-800-243-4361
Telephone Orders 1-800-367-5877
Text Telephone 1-800-243-1926
Web site PHOENIXFUNDS.COM
- --------------------------------------------------------------------------------
IMPORTANT NOTICE TO SHAREHOLDERS
The Securities and Exchange Commission has modified mailing regulations for
semiannual and annual shareholder fund reports to allow mutual fund companies to
send a single copy of these reports to shareholders who share the same mailing
address. If you would like additional copies, please call Mutual Fund Services
at 1-800-243-1574.
- --------------------------------------------------------------------------------
(This page has been left blank intentionally.)
---------------
PRESORTED
STANDARD
U.S. POSTAGE
PAID
Louisville, KY
Permit No. 1051
---------------
[GRAPHIC OMITTED] PHOENIXFUNDS(SM)
PHOENIX EQUITY PLANNING CORPORATION
P.O. Box 150480
Hartford, CT 06115-0480
For more information about Phoenix mutual funds,
please call your financial representative, contact us
at 1-800-243-1574 or visit PHOENIXFUNDS.COM.
NOT INSURED BY FDIC/NCUSIF OR ANY FEDERAL GOVERNMENT AGENCY.
NO BANK GUARANTEE. NOT A DEPOSIT. MAY LOSE VALUE.
PXP212
BPD25788 4-06
ITEM 2. CODE OF ETHICS.
Not applicable.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
Not applicable.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Not applicable.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable.
ITEM 6. SCHEDULE OF INVESTMENTS.
Schedule of Investments in securities of unaffiliated issuers as of the close of
the reporting period is included as part of the report to shareholders filed
under Item 1 of this form.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
Not applicable.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
There have been no material changes to the procedures by which the shareholders
may recommend nominees to the registrant's board of trustees, where those
changes were implemented after the registrant last provided disclosure in
response to the requirements of Item 7(d)(2)(ii)(G) of Schedule 14A (17 CFR
240.14a-101), or this Item.
ITEM 11. CONTROLS AND PROCEDURES.
(a) The registrant's principal executive and principal financial officers,
or persons performing similar functions, have concluded that the
registrant's disclosure controls and procedures (as defined in Rule
30a-3(c) under the Investment Company Act of 1940, as amended (the
"1940 Act") (17 CFR 270.30a-3(c))) are effective, as of a date within
90 days of the filing date of the report that includes the disclosure
required by this paragraph, based on their evaluation of these controls
and procedures required by Rule 30a-3(b) under the 1940 Act (17 CFR
270.30a-3(b)) and Rules 13a-15(b) or 15d-15(b) under the Securities
Exchange Act of 1934, as amended (17 CFR 240.13a-15(b) or
240.15d-15(b)).
(b) There were no changes in the registrant's internal control over
financial reporting (as defined in Rule 30a-3(d) under the 1940 Act (17
CFR 270.30a-3(d)) that occurred during the registrant's second fiscal
quarter of the period covered by this report that has materially
affected, or is reasonably likely to materially affect, the
registrant's internal control over financial reporting.
ITEM 12. EXHIBITS.
(a)(1) Not applicable.
(a)(2) Certifications pursuant to Rule 30a-2(a) under the 1940 Act and
Section 302 of the Sarbanes-Oxley Act of 2002 are attached hereto.
(a)(3) Not applicable.
(b) Certifications pursuant to Rule 30a-2(b) under the 1940 Act and
Section 906 of the Sarbanes-Oxley Act of 2002 are attached hereto.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
(registrant) Phoenix Equity Series Fund
------------------------------------------------------------------
By (Signature and Title)* /s/ George R. Aylward
-------------------------------------------------------
George R. Aylward, Executive Vice President
(principal executive officer)
Date May 5, 2006
----------------------------------------------------------------------------
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By (Signature and Title)* /s/ George R. Aylward
-------------------------------------------------------
George R. Aylward, Executive Vice President
(principal executive officer)
Date May 5, 2006
----------------------------------------------------------------------------
By (Signature and Title)* /s/ Nancy G. Curtiss
-------------------------------------------------------
Nancy G. Curtiss, Chief Financial Officer
and Treasurer
(principal financial officer)
Date May 4, 2006
----------------------------------------------------------------------------
* Print the name and title of each signing officer under his or her signature.